Unplugged: Toyota Axing RAV4 EV, Won’t Renew Tesla Deal

Toyota, realizing there aren’t enough Californians willing to drop 50 grand on a RAV4, will kill off its electric SUV and sever its powertrain contract with Tesla by year’s end.

The Tesla-powered RAV4 EV that debuted in 2012 was originally slated for only two model years as a way to satisfy California’s zero-emission mandate. In a regulatory filing this month, Tesla confirmed Toyota would not be renewing its contract after the vehicle’s planned 2600-unit run. So far, Toyota has sold 1594 cars through April. While the Tesla-sourced 42-kW battery and 154-hp motor let the RAV4 zip to 60 mph in as quickly as seven seconds, according to Toyota, and crank out a 103-mile EPA-estimated electric range, Toyota hasn’t been happy with battery-powered EVs and likely won’t build another. Thousands of well-off, green-minded Californians have instead spent much more money on Tesla’s own Model S.

Toyota still holds a three-percent stake in Tesla after the world’s biggest automaker invested $50 million in the start-up company during 2010. Tesla also supplies electric components to Daimler, which has a four-percent stake, for the company’s Smart Fortwo Electric Drive and the Mercedes-Benz B-class Electric Drive. Toyota’s other California “compliance car,” the Scion iQ EV, didn’t involve Tesla and its 90-car run has been limited to fleets.

What Toyota really craves is hydrogen, and lots of it. Its first hydrogen-powered fuel-cell car, which is being created in partnership with BMW, will go on sale next year, and the automaker recently announced it would subsidize the construction and maintenance of new hydrogen filling stations in California. Whether Californians will want to drop 50 grand on that car is something we won’t know until 2015.